Software Development and Trade: Role of Contract Enforcement and Copyright Protection

Hong Kong University of Science and Technology

39 Pages Posted: 30 Jan 2002

See all articles by Larry D. Qiu

Larry D. Qiu

The University of Hong Kong - Faculty of Business and Economics; Hong Kong University of Science & Technology (HKUST) - Department of Economics

Date Written: November 2001

Abstract

We develop a model to study the implications of a legal environment on software development and international trade. We show that the degree of contract enforcement affects the organizational mode (i.e., in-house versus outsourcing) of customized software development. In autarky, a country with weak copyright protection develops customized software only, while a country with strong copyright protection develops both customized software and packaged software. After opening to trade, the strong-copyright-protecting country exports packaged software and the weak-copyright-protecting country exports customized software. enforcement, vertical integration, contract, pattern of trade

Keywords: software, piracy, copyright protection, contract

JEL Classification: F12, L22, L86

Suggested Citation

Qiu, Larry Dongxiao, Software Development and Trade: Role of Contract Enforcement and Copyright Protection (November 2001). Hong Kong University of Science and Technology. Available at SSRN: https://ssrn.com/abstract=298302 or http://dx.doi.org/10.2139/ssrn.298302

Larry Dongxiao Qiu (Contact Author)

The University of Hong Kong - Faculty of Business and Economics ( email )

Pokfulam Road
Hong Kong
China

Hong Kong University of Science & Technology (HKUST) - Department of Economics ( email )

School of Economics and Finance
University of Hong Kong
Pokfulam
Hong Kong

HOME PAGE: http://www.bm.ust.hk/~larryqiu/

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